German, Swiss Governments in Advanced Preparation For The Collapse Of Euro. Where stupid Sarkozy is taking political decisions leading to his political suicide in 2012

The Swiss government is preparing for a collapse of the euro,
according to Swiss Finance Minister Eveline Widmer-Schlumpf. She told
parliament that a work group was studying the imposition of capital
controls and negative interest rates to protect Switzerland from the
capital flight that a euro collapse would engender (Handelsblatt).
A tidal wave of euros would drive up the Swiss franc, devastate
Switzerland’s export economy, and devalue its vast wealth invested in
other countries. Already in August, the Swiss National Bank instituted a
currency peg and swore to defend it by acquiring “unlimited” amounts of
euros, a risky strategy if the euro were to collapse (for the debacle
leading up to the peg, read... Swiss Franc Wreaks Havoc In Switzerland).

Meanwhile, 27 heads of state convened in Brussels for another
European Union summit to find that elusive solution to the debt crisis.
It began with dinner at around 8 pm and will continue on Friday. Goal:
changes in the EU treaty that would impose Germany’s new religion of
budgetary discipline on all 27 member states. Violators would be hit
with automatic sanctions. The European Court of Justice would have final
control over national budgets. (Ironically, Germany was one of the
first EU members to violate the existing 3% deficit limit and was the
primary reason existing sanctions have never been applied). Short-term
measures to keep contagion at bay are also on the agenda.

“Europe has never been in so much danger,” said French President Nicolas Sarkozy a few hours before the summit (Le Figaro).
He worried about “the risk that Europe will explode” and urged that an
agreement be found because there were only a few weeks left to make the
decisions. He called for more solidarity, more discipline, and more
governance within the Eurozone. “An agreement on Friday is crucial,” he
said. “We won’t have a second chance.”

But Angela Merkel’s fiscal-union dictate of belt-tightening and
central control over budgets isn’t going down all that well elsewhere.

“I don’t have any support in Sweden for changing the treaty,” said
Fredrik Reinfeldt, Prime Minister of Sweden upon his arrival in Brussels
(Le Figaro).
Sweden is one of the 27 EU members but not in the 17-member Eurozone.
To contain the debt crisis, he proposed instead the reinforcement of
existing bailout funds and more IMF involvement.

David Cameron, Prime Minister of the UK, had already thrown down the
gauntlet: he threatened to veto any measures that would hurt London’s
financial industry or would shift sovereignty from the UK to the EU.

“A new treaty can’t be imposed,” said Vivian Reding, Vice President of the European Commission (Le Figaro).
Instead, measures should be implemented on the basis of existing
treaties. She contended that Angela Merkel’s plan of centralized
economic governance was “just a copy of the Stability Pact that France
and Germany had torpedoed in 2003-2004. The mechanisms to contain the
excesses that have led to this crisis existed for a long time but were
never applied.”

Treaty changes require participation of the European parliament, the
EU Commission, and all 27 national parliaments. Then the treaty must be
ratified by all member states—by referendum in some cases. It would take
years and could be derailed by the referendum of a single country.

A less onerous alternative: treaty changes that would impact only the
17 Eurozone countries. Sweden, the UK, and other non-euro countries
would not have to agree to the changes. It might speed up the timing a
little, but if successful, if might split Europe in two: the Eurozone
with iron-clad budgets in Merkel’s sense, and the remaining ten EU
countries with no such restrictions.

A simplified procedure has been bandied about: decision by EU
countries and ratification by member states. But even that takes time—at
least one and a half years, according to an expert cited by the Handelsblatt—as
national parliaments might not readily agree. But deep changes, such as
outside control of national budgets, would require the normal
procedure, rather then the simplified one. In addition, they might
require constitutional changes in some countries, which would add to the
uncertainty for years to come.

Yet everything must be squared away by March, according to Merkel—a
deadline, actually: Sarkozy may lose his job during the elections in
April/May, and his potential successors to the left and to the right
have vastly different ideas and might not bend as easily to Merkel’s
will.... French Presidential Election: Coup De Grâce For The Euro?